Use your rental to pay off your primary residence faster!

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Mortgage and Lending with Golf Savings Bank

Doing a search on here I've come across a handful of blogs referring to the Home Ownership Accelerator from CMG Mortgage.  There seem to be a lot of controversies about this loan program and rightfully so.  However I haven't seen anyone take the perspective on it that I'm about to show you.

I've looked this program over on a number of occasions and while I feel it is a very good loan for the right people, there are many people who would be more beneficial to go with another type of financing.  The program isn't nearly as great as many of those who are selling it make it out to be. 

There is however one niche that I've found that this loan program can really shine.  For those who have rental properties!  This loan program is NOT available for the rental properties themselves but why not use your rental income to take full advantage of this type of loan program? 

For those of you who are not familiar with this type of loan program the way it works is it is a 1st position HELOC that has a checking account attached to it.  You put all your monthly income into the account which lowers the principal balance.  Then pay your bills and use the money just as you would out of your normal checking account.  Toward the end of the month the interest is calculated off the AVERAGE DAILY BALANCE (this is important).  So while your money is sitting idle in your checking account it is actually saving you the amount of interest that you would be paying that amount.  This savings in interest each month adds up over time and compounds itself paying off your mortgage significantly quicker than a typical 30 year fixed mortgage. 

Now how to take advantage of this program by using your rental property!  Your renters' rents are due on the 1st and are usually considered late on the 2nd or 3rd.  Your mortgage payment is due on the 1st of each month however it isn't late until the 15th of each month.  If you pay past the 15th you get assessed a late fee of usually $35.00.  So why not take advantage of this period?  You don't want to be charged the $35.00 late fee as that would be counter productive.  So take your rents that you receive on the 1st or 2nd of each month and put it all in your checking account that is attached to your Home Ownership Accelerator mortgage.  You want to make sure your lender gets their payment in time for the 15th so send in the mortgage payment for your rental property on the 12th or 13th of the month so as to give enough time for the mail to get it there.  Or if you pay it online and it is instant wait until the 15th!  Still yet your payment usually takes an additional 2 to 3 days to actually clear your account so you could actually pay up to 16 or 17 days worth of interest less each month on the amount of your rentals because this is driving down your AVERAGE DAILY BALANCE saving you thousands over the term of your mortgage and paying off your primary residence much much quicker!

What are y'alls' thoughts on this?  Have any of the loan officers on here who are currently selling this program thought of this approach?

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